Key insights
- An individual investor plans to generate income by selling out-of-the-money puts on XLE, PM, C, IBKR, and HOOD, targeting a 39.3% annualized return. This strategy reflects a cautious approach to entering the market, prioritizing income generation over direct equity exposure. While this specific plan has limited market-wide impact, it exemplifies a broader trend of investors seeking yield in a volatile environment.
I’ve been waiting for relatively “stable” market conditions to buy stuff with 50k that’s been waiting around after I sold everything I was in a few weeks ago. That’s probably not gonna be a thing for a while.
So I figured instead of buying shares, I’d sell puts on stuff I’d be happy to take the ride with if I get assigned, and until then, keep rolling out of the money puts.
These are the ones I’m strongly considering:
XLE $58
PM $152.5
C $110
IBKR $64
HOOD $62
The plan is to generate an average of $320 a week on those, which works out to 0.64% a week. That annualizes to 39.3%.
For you guys who feel like staying in cash without getting left out of the action, something to consider perhaps.